Is Smucker Cornering the Oil Market?

The Federal Trade Commission is challenging Smucker’s purchase of Wesson from Conagra Brands. Smucker already owns Crisco. The government claims the deal would give Smucker 70% of the cooking oil market.

“Cooks across the U.S. benefit from the competition between the staple brands Wesson and Crisco. We are taking this action to preserve the benefits of that competition,” said FTC lawyer Ian Conner.

The FTC said each brand attempted price increases over the last two years but was constrained by the presence of the other. With that restraint no longer in place, Smucker could raise prices on both brands, the commission alleged.

Smucker Chief Executive Mark Smucker said the company was disappointed in the FTC’s conclusion and believed the acquisition “would benefit all of our constituents.”

I honestly don’t know if this is a strong case or not. The news came out after the close. Many times, deals like this can get approval if the company agrees to certain limitations.

Posted by on March 5th, 2018 at 9:45 pm


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